Work is now underway on a 'pioneering' rent-to-buy housing development in Newton Mearns.

The 42-flats in the scheme are the first in Scotland for Birmingham-based investment firm QSH, which has set a target to raise £250 million from UK-based investors to deliver 2,000 properties.

QSH and its investment partner Wates Living Space, who will build the properties, have agreed terms with East Renfrewshire Council; landowner Greenlaw Park Ltd, owned by property developer Kenneth Ross; and Pinnacle PSG, who will manage the apartments.

Under the QSH-rent-to-buy scheme, tenants will pay rents at two thirds of the local market rate with half of each tenant’s rental payment automatically put towards the deposit they need to secure a mortgage to buy the home.

Tenants will have the option to buy between their first and fifth year of occupancy, and purchasers will “receive a discount of up to 10 per cent of the open market value”.

Those who opt not to buy within the time frame will be allowed to continue renting for a further 15 years.

The Greenlaw development, just off Stewarton Road, is expected to complete in the spring of 2016.

Nicola Clayton, business development director at QSH, said: “The Greenlaw scheme will enable households that dream of buying a home in the desirable Newton Mearns area the chance to build a deposit and credit history, and take their first step onto the property ladder.”

Councillor Danny Devlin, convenor of housing services for East Renfrewshire Council, added: “The development will provide much needed affordable homes in Newton Mearns, which has some of the highest rents in Scotland.

“Many local people cannot afford to remain living here – now 42 households will have the opportunity to pay affordable rents, while working their way to home ownership.”

QSH says its business model has been formulated to target the funding issues faced by councils and housing associations to provide access to properties with longer term capital repayments.

Its states this target market is estimated to be worth nearly £10 billion a year.

QSH states in an investment document its model works by “acquiring properties at discounts to open market value from developers, developing new properties on council/housing association owned or discounted land, or acquiring empty properties for refurbishment”.